All posts by admin

What Preapproval Means for Car Loans

Everyone likes to get a good deal. When you are offered a low monthly payment on your car loan, that might seem like the best deal of all. In the long run, however, that low monthly payment might actually end up costing you hundreds of dollars more than you intended to pay. In order to understand the true total cost of car loans, you must look at three different factors.

Loan Amount

The initial amount you borrow is called the loan principal. The amount of principal you have left at the end of every billing cycle is one half of the equation that determines how much you will pay in interest. To lower the total amount you pay on the entire loan, it is a good idea to start with a lower principal. If you are able to pay 20% of the initial $25,000 cost in a down payment, that is $5000 of the purchase price that never figures into the interest you are charged.

Loan Rate

The other half of the interest equation is the interest rate itself. Bargaining for a lower interest rate can significantly reduce the price you ultimately pay for your next vehicle. A great credit score and other factors, such as dependable income, can lower your risk factors with the lender and thus can result in a lower APR, saving you a great deal of money.

Loan Term

A lower monthly payment might be tempting. When you accept a lower monthly payment, however, you are lengthening the term of your loan, postponing the date when the car will be paid off and costing yourself a lot of money in the process. You will pay significantly less interest with a 2- or 3-year loan term than with a 4-year loan.

When negotiating the terms of car loans, fight the urge to take it easier than your monthly budget can handle. Factor in the amount, rate and term of your loan to get the best deal overall.

How to Finance a Used Car in Canada

If you’ve found the new-to-you car of your dreams but don’t have the cash to pay for it in full, financing is the solution. In this post we’ll go over everything you need to know so you can secure the right kind of auto financing for your vehicle and your bottom line.

How car financing works

Taking out a car loan eliminates the stress of coming up with a large sum of money all at once. However, it also adds another monthly payment to your budget, so it’s important to understand the ins-and-outs of car financing before looking at the different lending options.
Your monthly car loan payments are calculated using three elements: principal, term and interest rate. 
Principal is the total cost of the vehicle, including any fees the lender or dealership may have for the car loan and any add-ons you choose.
Term is the length of time that payments will be made on the loan — typical terms range from 36 months to 72 months.
Interest rate is the percentage the lender is charging you to borrow money. 
Fixed rate loans offer predictability because the interest rate stays the same throughout the term of the loan. If you’re less concerned with fluctuations and want to benefit from times when interest rates are lower, you can opt for a variable rate loan.

Borrowing for new and used cars

New and used cars get treated differently by lenders for a few reasons. For starters, new cars have a higher sticker price than pre-owned cars. While this usually means buyers can cash-in on incentives like rebates or 0% financing for a certain period, it also means loan payment terms will be longer and monthly premiums will be higher. Also, new cars are usually more expensive to insure. 
Used cars, on the other hand, cost less to purchase. They do, however, require more upkeep than new cars and interest rates on pre-owned vehicles are usually higher — especially if you don’t have much for a down payment or have less than stellar credit. 
Check out our post for things to consider when deciding whether to buy a new or used car.

Ways to finance a used car

There are two main ways to secure a car loan in Canada: through a financial institution or directly through a dealership. Each route has its advantages and it’s a good idea to shop around to ensure you’re making the best decision for your financial situation. 
Before applying for any loan, it’s a good idea to check your credit rating and determine your budget. Whether high or low, your credit rating will dictate the interest rate on your loan; knowing your budget will help you figure out how much you can afford for monthly payments. If your monthly payments are more than your budget allows, you run the risk of defaulting on your loan and damaging your credit rating.
Figuring out your budget can also help you decide how much you’re able to put forward as a down payment —  a larger down payment often translates to lower rates because you’ll be borrowing less.
Now, let’s get into the differences between bank financing and dealership, or in-house, financing.


If you have a good credit rating securing a used car loan through a bank or credit union might be the right choice for you. Getting a loan through your current financial institution can be a convenient option since all of your finances are in one spot. If you’re an established customer, your bank might even offer you a discount on interest rates or fees and most banks are open to negotiating the terms of your payment period.
However, because of their stricter rules and regulations, banks will only grant loans to customers with favourable credit — even for pre-owned vehicles. So, if you have a low credit rating you might not get approved. 
Some banks are wary of granting loans for used cars because they depreciate in value quickly. It’s a good idea to ask about the financing options for the specific make and model of the car you’re interested in.
It can also take longer to get approved through the bank, so you might be stuck waiting several business days to find out if your loan application has been accepted.


The second option is to get financing directly from the dealership you’re buying a car from. The main advantages of in-house financing are speed and flexibility. 
Because the application and approval process is a lot quicker, many dealerships are able to offer same-day financing. That means you can take a test drive in the morning and drive your new (or new-to-you) car off the lot by the afternoon. This way you won’t have to worry about someone else snatching up the used car you fell in love with while you’re waiting for financing to come through. 
Dealerships offer significantly more flexibility for borrowers with less-than-stellar or non-existent credit (as is the case with students or new Canadians). If you have poor credit or have gone through a bankruptcy, shopping for a vehicle can be frustrating and disappointing. In-house financing can help get you into the car you want, even if you’ve been previously turned down for a loan through your bank. 
At Birchwood Credit Solutions, we look beyond our customers’ credit rating. Once you apply for financing, our team will review your whole financial situation and work with you to pick an appropriate budget and payment options. We can even offer you help and advice on how to repair your credit rating.
Learn more about Birchwood Credit Solutions’ Bad Credit Car Loans and quick, hassle-free application process. You can also contact us to talk directly to a car financing expert.

When is the best time to buy a car?

Getting a good deal on a new or used car can depend on the time of year you buy it. Make sure you keep an eye on the calendar so you can take advantage of seasonal factors affecting the car trade and take advantage of the best month to buy a car. So if you are looking for the best time of year to buy a car, here are some dates to bear in mind.

Best time to buy a new car

Choosing the best time of the year to buy a car could potentially save you thousands of pounds.

Here’s what to bear in mind:

  • Convertibles are more desirable in the summer, so there might be bargains to be had in the winter.
  • At the end of each quarter – particularly the end of June and December – dealers might be keen to hit their quarterly sales targets and more likely to offer you a good deal.
  • Demand for four-wheel-drive vehicles usually peaks during autumn and winter because of poorer weather, so you might get a bigger discount in the summer.
  • In February and August many dealers offer some real bargains, while sales are slow as buyers wait for the new number plates coming in March and September. But If you take advantage of this lull, your ‘old’ number plates will make your car seem older than it really is, so it will depreciate faster.
  • Find out when new models or ‘face-lifted’ existing models are due out, then buy the previous version during its last few weeks in the showroom. Dealers will be want to shift this stock and be more likely to offer you a good deal. But remember an older model will depreciate faster than the new arrivals, even though it’s roughly the same age.
  • Showrooms are quieter on weekdays so drop in on a Friday – when the dealer will also be keen to meet their weekly target. This gives you an advantage when bargaining with the salesperson.
  • Wait a few months after launch before buying a new model – by then there will be less showroom buzz about it so the dealer might well offer you a better deal.

Best time to buy a used car

Seasonal trends in sales of new cars have a knock-on effect on the cost of used cars.

Time your purchase right and you could get a real bargain:

  • Avoid buying used convertibles in the spring or summer – wait until winter, when demand is much lower.
  • March and September are the peak months for sales of new cars, often through part-exchange deals. So dealers will have lots of used cars to sell, which puts you in a strong position when negotiating.
  • Dealers are also often keen to clear out used cars in July and early August in readiness for new models and the registration plate change on 1 September.
  • December and January are quiet months for the used car trade. Cars aren’t on people’s minds around Christmas and the New Year so dealers and private sellers are keen to make a deal.
  • Buy four-wheel-drive vehicles in the summer – demand peaks in the late autumn and winter because of the poorer weather.

3 Ways Dealers Help You Find the Perfect Used Car

Despite popular beliefs, seeking the assistance of a dealer while searching through the multitude of available used cars is a smart move which any budget-conscious buyer should consider when in the market for a ride of any shape, size or brand. There are many ways in which using our dealership for assistance throughout the shopping process makes the whole experience simpler and much less stressful, but the top three include:

We Offer a Larger Selection

Whereas you may have to drive hours to view a single car when shopping among private sellers, our large selection of vehicles gives the ability to view many new cars at once, increasing your chances of finding the perfect used car quickly. This saves you time, money, and plenty of energy with which to enjoy your newly-purchased ride after the decision has been made.

We Offer Financing Options

In most cases, even used cars have financing options available for buyers of all backgrounds. This means that you won’t be restricted to one or two cars on the lot that fit within your immediate budget. Together, you and our expert staff members can work out a payment plan for practically any of our used vehicles, expanding your opportunities and helping to ensure you find the right car for your needs.

We Offer Quality

Aside from offering an excellent quantity of vehicles, we always ensure that our used cars present quality under the hood as well. Before selling cars to customers, we inspect the vehicle and make repairs as necessary to ensure you’re getting what you pay for: a reliable ride that’ll get you from one place to another without a hassle. When you find the right car, you’ll never have to worry about it being a lemon.

These are just some of the ways in which we can help you find your perfect used car and get you on the road again in no time. Check with us to learn more about your options.

Key Steps to Take When Purchasing a Used Car to Make Sure You Are Comfortable

If you are on the hunt for quality used cars in your area, there are some key steps to take to be sure the entire process goes well. We recommend taking these steps to ensure you get exactly what you want and spend the amount you want to in the end. The most important thing is guaranteeing the vehicle you buy is top quality. We want to make sure that happens for you, so here are the steps to remember in the process.

Consider All of the Details When It Comes to Finances

Our concern is not how much you spend, but that you spend a comfortable amount and receive the quality you deserve. This is why we recommend you figuring out your detailed budget beforehand. Calculate in everything, including the total payment of the car and any insurance that you need. Also, be sure to not make a car payment that is over 20 percent of your take-home income. This way, you will find yourself in a safe and secure ride and not in a financial hole.

Have an Inspection Done on the Car on Your Own

While all of our vehicles are thoroughly inspected and are in top condition for you before you even check them out, we recommend you taking it for an inspection on your own with someone you have history with and trust. Our goal is for you to feel like you can one hundred percent trust our vehicles and us. This is why you should take it to a mechanic you know and confirm the positive inspection results we will give you.

We are set on offering you used cars that are of the best quality around. All of our cars have been tested, driven, checked, inspected and have come out with clean results. We want you to be happy with your buy, so we recommend you take the steps above until you feel confident with the car you are considering.

Avoid These Mistakes When Buying Used Cars

Whether buying new or used cars, this should be a happy time for you. However, sometimes people don’t approach the car buying process the way they should and end up making some mistakes. Here are some mistakes that we have seen people make that we want you to avoid on your quest for the perfect vehicle for you.

Not Buying from A Reputable Dealer

Car dealerships and salespeople often get a bad rap. However, you will find that most just want what’s best for you. Try to find a dealer that has a good reputation in the local area. Look online to check out their reviews and what other customers are saying about them.

Skimping on The Test Drive

When you take a car out for a test drive, make the most of it. Drive a route that looks like the route you will usually take every day during your average commute. Drive on the freeway and down a city street to see how it handles at slower or faster speeds. Then consider taking it to a mechanic you trust so they can identify any potential issues that could come up in the future.

Not Knowing the Value of Their Car

If you are planning to trade in a vehicle or sell your vehicle prior to purchasing a new one, make sure you know what your car is valued at. There are many tools online to help you determine your car’s value. Remember that when you go to sell or trade in your car, you are unlikely to get full market value for your car. However, be flexible and negotiable and you should have a great experience.

Buying used cars is a fun process and you should be able to enjoy it. With some of these steps in mind, you’ll be well on your way to a new car purchase that you will love for years to come.

Used Cars Make Nice Rides Affordable

For many people, used cars represent an opportunity to save a great deal of money even as they acquire luxury rides. Often fitted with the very best amenities, these cars are still attractive, fully functional, and extremely good deals when one considers how much he or she gets for a relatively small investment.

Among the types of vehicles individuals and families might expect to find when they look through a previously owned auto lot are SUVs, trucks, vans, luxury and economic vehicles. Literally, there is bound to be something for everyone. Considering the class of vehicle you would most like to purchase is one way to narrow down your search. With your perfect main style in mind, there are a lot of options still regarding model, make, and add-ons.

Once you have found your favorite used cars, you should compare them to decide which one best fits your needs. If you only a car to get yourself back and forth along a fairly easy route, you may not really require an SUV or a minivan. Consider a smaller a vehicle with a great fuel rating to save money over the course of the vehicle’s life. With lower out-of-pocket expenses and monthly payments, your chances of purchasing the car of your dreams every time you need a replacement are better.

Not only will lower monthly payments, fuel costs, and down payments help keep you in the black financially, but you can also feel better about choosing a vehicle that promotes a healthier planet and you. There are many types of used cars on the road, but the best car for you is likely to be one that will cost less to run, be more energy efficient and cost effective, and last longer.

Not everyone seeks the nicest car on the road, but all of us should expect to be able to acquire comfortable vehicles for reasonable prices, especially when we shop for used cars.

Three Categories of Car Bargains

Our dealership offers a large number of solid deals on used cars. We stock a variety of vehicles on our lots that are ready to be driven off and provide years of exciting and economical transportation. A good way to look at our inventory is to break it down into three broad categories.


  1. There’s no surprise that buying a used car is a great way to maximize your dollars. You can take it even further by looking for a car that provides great value above and beyond the purchase price. Often this means looking at smaller cars such as sedans that get great gas mileage, are reliable and have low maintenance costs. The savings you get from lower insurance costs, decreased taxes and registration fees, and more, are a great way to create a little breathing room in your budget.


  1. This level of vehicle can include crossovers, SUVS, minivans and trucks. For a moderate price, you can find an attractive vehicle from our lot that has a medium-level of miles on the odometer. This route gives you the opportunity to get the vehicle you desire and will only increase your monthly payments a little bit. You will still reap the savings associated with buying used, and you will still get a great car at an affordable price.


  1. If you are looking for used cars with super low miles, we carry a good selection on our lots. You can also find high-performance vehicles, as well as luxury models that offer smooth rides, spacious interiors and the latest technology. You will pay more for a fully-loaded vehicle, but you will get to enjoy all the perks of an exceptional ride.


No matter what you decide, our customer service department will work with you to ensure your happiness. We offer financing, service and a friendly environment to do business in.

Reasons to Buy Used Cars from the Dealership

When you’re in the market for a new car, you can either hit the internet and look in online classifieds for a private seller selling a car, or you can go to the dealership and buy a used car there. While you’ll have a more casual and possibly comfortable experience when purchasing from a private seller, there are actually a lot more valuable advantages when buying from a used cars dealership. With that in mind, here are some of the benefits you’ll enjoy.

Additional Options

When buying a used car from a dealer, you’ll be given a lot more options. A private seller isn’t going to offer you free tire rotations or car washes for the life of your vehicle, but a dealership might. They won’t give you discounted oil changes for as long as you have the car either, but some dealerships offer these types of programs as well. From extended warranties to discount maintenance and service programs, dealerships usually offer additional options that private sellers just can’t.

Good Local Reputation

In an ideal world, every financial transaction goes smoothly and with smiles all around. Unfortunately, there is room for a lot to go wrong anytime you’re doing a transaction with someone you met online. What happens if you get a used car for a great deal online and something goes wrong with the car? When you buy through a local dealership, you have the confidence that they’ll treat you right based on the research you did online and the reviews that you saw for the company.

There are ultimately a lot of reasons to go through a dealership when looking for used cars. We want everyone buying a new car to feel confident that they’re getting a good deal and have confidence in the car itself when they drive it off the lot, which is the primary reason to buy through the dealer rather than a private party seller.

Buying a Used Car? How to Choose the Right One

When you’re in the market for a vehicle, there are many factors in choosing between the myriad of used cars for sale by different dealers. There is a number of things that should be checked over and considered before deciding on the right vehicle to meet your needs. Below are some of the most important factors in choosing a car.


  1. Check the Odometer


One of the first questions is always “how many miles are on it?” This is because mileage represents the likelihood of wear and tear on a vehicle. Consider how many miles you are likely to put on the vehicle. Perhaps your commute is not a long one, or maybe you and your family tend to go on long road trips. If there are a lot of miles on the car you’re researching, is there any way to know whether they are highway miles? They tend to be easier on the vehicle.


  1. Look for Red Flags


It’s important to carefully check the interior and exterior of a vehicle for any ‘red flags’ that can alert you to a serious problem. Be sure that there is no oil or other fluids leaking, as this is a big sign of damage and could be costly. It may also be a good idea to satisfy yourself that there is no rust on the vehicle, especially if you’re looking at an older car.


  1. Use the Test Drive


Be sure to test drive the vehicle, and when you do, pay close attention. Listen for any concerning sounds, and learn about any features the car has (heated seats, etc.) that you may or may not like. The test drive should be incredibly helpful in deciding whether the car is going to be a good selection for your family.


These are some of the most important things to consider when you’re looking at used cars. The above suggestions can be beneficial as you compare different vehicles and make a final decision about which one is going to work well for what you need.